It was a tough year for Japan’s largest roll goods producer Japan Vilene, Tokyo, Japan. Not only did the company’s sales decrease more than 10% due to weakened demand and negative currency rates, Japan Vilene reported lower results in all of its key segments—apparel interlinings, air filtration, automotives and battery separators.

Apparel interlinings, a market that has faced increased challenges from foreign competition in Japan, has traditionally been Japan Vilene’s core business. In 2001, however, apparel interlinings sales continued their descent, begun a few years ago, decreasing 15% to ¥8.1 billion compared to ¥9.6 billion in 2000. This continued contraction can be blamed chiefly on the apparel industry’s move beyond Japan. While Japan Vilene was not immediately affected by this trend because it was able to ship its materials to foreign producers, more recently apparel companies in areas such as China, Korea and Taiwan have begun to rely more on nonwoven materials produced locally. To offset some of this lost business, Japan Vilene is reportedly promoting productivity and reducing costs by altering the types of nonwovens it uses and making production facilities more efficient.

Looking toward Japan Vilene’s automotives business, sales of automotive mats and headliners, comprising nonwoven material, have decreased on the heels of decreased car production in Japan. This trend has subsequently driven down sales to the automotives industry 8% to ¥15.4 billion. Unlike the apparel industry, however, the slowing automotives market is a recent trend; 2001 was the first year it reported a decrease.

Coming off of a year of solid growth in 2000, the company’s air filtration business also reported a slowdown with sales decreasing 5% to ¥9.6 billion due partly to a slowdown in demand for air conditioner units. Nevertheless, executives do remain somewhat bullish about this segment. A great deal of potential lies in automotive interior filtration applications, which is becoming a popular trend in the Japanese automotives industry.

Industrial material sales have decreased due to the influence of a recession in the information and technology segments. This is mainly being seen in the battery separator market, as demand for the separator has decreased in proportion to the decreased production of the battery. Still, the use of batteries in hybrid electric wheel chairs is increasing, which should boost sales to some degree.

Looking globally, sales outside of Japan continue to outpace the company’s domestic operations. Accounting for 17% of the company’s total sales, domestic sales increased 2.9%. At ¥5.8 billion, North America continues to be Japan Vilene’s largest foreign market.

The year 2002 was marked by a 5.5% decrease in Japan Vilene’s overall sales, which were slightly less than $300 million. Meanwhile, the company’s nonwovens sales dropped from $194 million to $168 million, caused both by currency fluctuations and pricing pressures in its core markets. For instance, sales in apparel, air filtration, medical and consumer categories all registered decreases and only automotives and electrical were positive. Industrial sales remained flat.

The bulk of Japan Vilene’s weakness was registered within Japan; domestic sales increased 13.3% and represented 20% of total sales led by significant gains in North America and Asia. Japan sales decreased in the double-digit range.

According to news reports, Japan Vilene received a temporary boost from concerns related to Sudden Acute Respiratory Syndrome. n April, the company’s share price rose nearly 30% in one day on expectation of strong flu mask sales. Company executives reported that mask sales, which are traditionally strong in hay fever season, were boosted by a practice among airlines of distributing medical masks to passengers in-flight. SARS panic has since subsided and mask sales have returned to more typical levels.

The most rapid growth rate was reported in sales of electrical materials, which continued the success it first achieved in 2002. This has largely been attributed to sales of nonwovens in the battery separators market. Japan Vilene’s core niche in this segment is in nickel hydrogen batteries used in hybrid electric vehicles made by Toyota and Honda. Demand in this market is expected to increase as production of these hybrid gas/electric vehicles continues to rise.

Of the company’s sales, ¥28.2 billion were domestic and ¥10.1 billion were reported overseas. Japan Vilene’s largest foreign market is North America, representing ¥5.8 billion (a 10.8% decrease compared to last year), followed by Asia, which represents ¥3.7 billion, a 35.4% increase.

The growing importance of Asian markets is evident in recent investments reported by Japan Vilene. Most recently, the company announced a joint venture agreement with its partner Freudenberg Nonwovens in the Chinese filter market. Together, the two companies acquired 75% of Changchun Autofilter (CCAF), which mainly targets the car and truck filter market in China. CCAF will retain the remaining 25% of the business. The group will produce and sell filters for engine and cabin filters and was scheduled to begin constructing a new facility in June. Before the plant is complete, FVFC will produce filters at CCAF’s existing facility in Changchun. Technology and know-how will be transferred to the new company from partner companies in Japan and Germany.

Meanwhile, in the U.S., Japan Vilene’s wholly-owned subsidiary VIAM has been producing floor mats in facilities in California and Tennessee for some time. The Tennessee site is about to be expanded.

Japan Vilene has had considerable success in the automotives market and can produce various products including floor mats, ceiling materials, air filters and battery separators for hybrid vehicles. As the automotives industry is forecast to grow in 2004, this will boost consolidated sales at Japan Vilene.

Looking ahead, the company is using a five-tiered strategy to achieve future growth. This includes: responding to the changing needs of customers and markets; enhancing competitiveness by recognizing business opportunities and aggressively investing in high growth areas; effectively utilizing human resources; working toward a harmonious coexistence with the environment and reinforcing the trust and confidence of stockholders and other stakeholders.

In terms of market areas, Japan Vilene will continue to reinforce its competitiveness in existing markets that have struggled. These include car mats, glass nonwovens and battery separators. Meanwhile, the company will increase its focus on newer markets such as auto cabin filters and standardized face masks. Growing overseas business will also be a top priority.

For Japan’s largest roll goods producer Japan Vilene, 2004 was marked by significant sales growth outside of its core domestic market. Domestic and overseas sales represented ¥49.4 billion of the company’s consolidated sales in 2004. Sales within Japan decreased 5.0% to ¥36.6 billion, while sales outside of Japan increased 26.1% to ¥12.8 billion. According to the company, the ratio of foreign sales to total sales increased 20.8% in 2003 and 26.1% in 2004.

Geographically speaking, Japan Vilene achieved solid sales in both North America and Asia last year. At ¥6.7 billion, sales in North America increased 13.9% over 2003 while sales in Asia totaled ¥5.5 billion, a jump of 50.8%. Sales in the rest of the world amounted to ¥0.6 billion, a 4.5% decrease. In contrast to the company’s sales gains in the North American and Asian markets, Japan Vilene’s domestic sales were disappointing, dropping to ¥36.6 billion in 2004 from ¥46.4 billion in 2000-a dramatic ¥10 billion decline in four years.

On the positive side, Japan Vilene enjoyed strong gains in the electrical materials segment, where sales jumped from ¥3.2 billion in 2001 to ¥5.2 billion in 2004. The company’s major product line in this segment continues to be battery electrode separators. Demand for nickel-hydrogen batteries, used for hybrid gas/electrical vehicles, is expected to increase rapidly in the future, a boon for Japan Vilene since it holds an overwhelming share of the nonwoven battery electrode separator market worldwide.

In terms of its global strategy, Japan Vilene has focused recent efforts on the expansion of its overseas business and is especially enthusiastic about progress in China. Established in April 2004, its FVFC joint venture with partner Freudenberg Nonwovens has been producing automotive air filters since January 2005. With operations beginning in March 2005, Japan Vilene’s wholly owned subsidiary TVA Co. manufactures and sells automotive floor mats. In May 2005, Japan Vilene acquired interlinings manufacturer NHC Co., an operation that just came onstream in July under the new name FVN Co. The company’s new enterprises in China are expected to increase in 2005 from this year’s sales level of ¥5.5 billion.

With a plan to boost sales to ¥61 billion by 2008, Japan’s largest roll goods producer Japan Vilene has had a busy year. Consolidated sales in fiscal 2005 (April 2005-March 2006) totaled just under ¥22 billion, a solid 5% increase over the previous year.

Domestic and overseas sales represented ¥51.9 billion of the company’s consolidated sales in 2005. Sales within Japan increased 2.5% to ¥37.5 billion while sales outside of Japan increased 12.3% to ¥14.4 billion. While domestic sales decreased and exports increased in 2004, both domestic and overseas sales increased in 2005. Last year exports represented 27.6% of total sales, a jump over 2004’s ratio of 25.9%.

Japan Vilene achieved solid sales in both North America and Asia last year. At ¥8.5 billion, sales in North America increased 27% over 2004 while sales in Asia remained at ¥5.5 billion. Sales in the rest of the world amounted to ¥0.4 billion. According to the company, the increased revenue from sales of automotive materials in North America contributed greatly to its overall sales growth in 2005.

Speaking of growth, Japan Vilene has installed an electrospinning pilot plant for nanofiber nonwovens, which is capable of producing materials as wide as one meter. The average fiber diameter can be adjusted within the 0.1-1.0 υm range while the average pore size of the nonwovens is in the 0.4-2.0 υm range. Average density is within the 5-25 gpsm range.

Currently acrylic fiber is predominantly being used for these applications; however, the electrospinning method can employ various polymers as raw materials. Nanofiber nonwovens target applications such as air filtration, battery electrotrode separators and medical materials.

Of the company’s gross sales of ¥56.3 billion in 2006, ¥36.8 billion were domestic sales and ¥19.5 were international. Domestic sales decreased 1.8% to ¥38.6 billion wile international sales increased 35.8% to ¥19.5 billion. Leading international growth was North America, where Japan Vilene was able to grow its business 58% to ¥13.4 billion, led largely by supply to the North American automotives market. Additionally, Asian sales increased 2.6% to ¥5.7 billion.

In terms of new technology, Japan Vilene has developed a component of proton-exchange membrane cell (PEFC) and it is currently applying this technology to a number of application areas. One area is electrode battery separators where the technology is applied to mulled carbon particle and resin. The carbon fibers typically used for the electrodes have a number of drawbacks including higher costs and fragility but the technology being offered by Japan Vilene is flexible and lower cost.

Another component being developed by Japan Vilene was an intake filter for the PEFC that fully uses the technology of Japan Vilene. In terms of PEFC as a next generation energy source, may enterprises are concerned and involved with the worldwide development competition. Japane Vilene expects nonwovens with PEC to be among its key products of the future.

High growth in the automotives market helped make this segment Japan Vilene’s largest division, accounting for 45.1% of total sales. Some of this success can be attributed to sales of floor mat and ceiling headliners for interior automotive applications in the U.S. Together with Freudenberg, Ja­pan Vilene has been developing these materials for the automotives and VIAM manufacturing have produced floor mats.

Japan Vilene has worked toward globalizing its filter business and has established a joint cooperation with Freudenberg named Freudenberg & Vilene Thailand (FVFT) in September 2007. This partnership began producing and selling air filters in January 2008 mainly to the automotive and gas turbine markets. Each company has an equal stake. Thailand was chosen as the manufacturing base of this operation because the companies determined an Asian location would help it take advantage of the growing automotive industry in the region.

Meanwhile, Japan Vilene has continued the development of its proton-exchange membrane cell (PEFC) and it is currenty applying this technology to a number of application areas. One area is electrode battery separators where the technology is applied to mulled carbon particle and resin. The carbon fibers typically used for the electrodes have a number of drawbacks including higher costs and fragility but the technology being offered by Japan Vilene is flexible and costs less than competitors.

Japan Vilene’s total sales decreased 14.9% during the year ended March 2009. In terms of departmental sales, apparel and medical materials decreased 7.9% to ¥10.5 billion; automotives decreased 18.8% to ¥21.6 billion, air filter materials decreased 6.7% to ¥8 billion, industrial materials decreased 18.3% to ¥8.7 billion and the remaining sales decreased 20.7% to ¥1.4 billion. Sales decreased in all areas due to the global economic crisis which began in September 2008.

Sales of automotive floor mats in Japan dropped significantly in 2008 on the heels of decreased automobile sales. Also in Japan, demand for floor mat and headliners regressed greatly because of the sudden decrease of automotive output. Owing to these accounts, demand is sluggish in many of the applications for automotives and recovery will not be likely in 2009. Under these circumstances, Japan Vilene estimated that sales this year will decrease 8.4% and as such automotives material sales will decrease 16.7% to ¥18 billion.

Despite the economic slump, Japan Vilene is seeing some bright spots including the nonwovens separators in the nickelmetal hydrogen battery used for the hybrid car applications. Demand for these batteries is growing as the hybrid automobile industry grows. However, because the nickel metal hydride batteries might be replaced by lithium ion batteries in hybrid cards, it is uncertain how long this demand will grow. Generally, microporous films are used as separators in lithium ion batteries and the nonwovens have not been used here at all. Still, Japan Vilene is pushing forward with the development of a nonwoven separator, which could be applied to the lithium ion battery.

Regarding the demand of covering masks, the business is favorable due to the prevention of swine flu; however, this demand is expected to slow as efforts to stop the spread of this disease wane.

Gross sales of the consolidated financial statement of fiscal 2009 (from April 2009 to March 2010) for Japan Vilene, Japan’s largest nonwovens producer, decreased 8.8% compared to the previous year’s period. By department, apparel and medical materials sales decreased 4.1% to ¥10.1 billion, automotives sales decreased 17.9% to ¥17.7 billion, air filter materials decreased 13.9% to ¥6.9 billion and industrial materials increased 12.3% to ¥9.8 billion.
Increasing demand for nonwovens as separators in nickel metal hydride batteries for hybrid cars was the key factor in the growth of the industrial market; however, other markets were hurt significantly by the global economic crisis. Still sales overall grew slightly from ¥20.4 billion to ¥20.7 billion.
In terms of regional sales in 2009, ¥36.7 billion was in Japan, a 3% decrease, ¥9 billion was in North America, a 26% decrease, and ¥0.1 billion, a ¥39.3 million increase, were in Asia.
North American sales were driven down by a reduction in the use of automotive floor mats brought on by lower automotive sales in the continent. On the other hand, a rebound in automotives sales, as well as increased production of the hybrid automotives market, have contributed to rebounding sales in this market.
Japan Vilene devised a medium-term management vision in June 2020 to achieve consolidated sales of ¥70 billion by March 2015. This would mean an increase of ¥13 billion in new businesses and ¥11 billion in existing businesses. At the same time, the company will raise the consolidated ordinary income to ¥6.5 billion in March 2015 from its current level of ¥2 billion.
From a production stand-point, this strategy calls for the introduction of state-of-the-art and high functioning equipment to produce high value added products. In the Shiga site, Japan Vilene is developing investments with low environmental impact

Total sales for Japan Vilene for the year ended March 2012 were $568 million, down 4%, while the nonwovens portion of these results were $263 million. According to executives, sales of clothing, medical materials and air conditioning materials have been increasing slowly, while sales in industrial and automotive markets have decreased. Additionally, Japan Vilene’s performance was hurt by currency fluctuations, the European recession and natural disasters, including the major Japanese earthquake and tsunami of 2011 and flooding in Thailand.

Currently, $387 million of sales are conducted in Japan while $127 million are in North America, a 9% decrease) and $47.7 million are in Asia, a 24% increase.

In 2011, Japane Vilene established a new filter company in China and an automotive floor-mat manufacturing site in Mexico called VIAM Mexico.

The Chinese filter company, which Japan Vilene has established jointly with Freudenberg, is called Freudenberg & Vilene Filter Inc. in China, with both companies having an equal share. This company has already manufactured and marketed filters in Suzhou and Changchun, China, and a third production site is being established in Chengdu, in the Midwest region of China, where automotive and industrial markets are growing.

VIAM Mexico, which Japan Vilene owns fully, will begin making floor mats in October to serve U.S. and Japanese automotive makers that have established manufacturing bases in Mexico.

Reporting increases across several segments was Japan’s largest nonwovens producer Japan Vilene. The Tokyobased company says its sales rose in apparel and medical, electricity and industrial and automotive materials while sales within the air filtration market were down.

In regional terms, sales decreased in Japan but increased significantly in both Asia and North America. North American sales particularly increased 37% due to the formation of Vitech Manufacturing, an automotives material manufacturing business formed in partnership with Freudenberg, the world’s largest producer of nonwovens and a long-time Vilene partner.

Sales in apparel and medical were driven by increased production of the epithem medicine base cloth overseas while electrical and industrial materials sales were boosted by increased battery separator sales. Automotive sales benefited from increased floor mat sales as well as increased use of Vilene products in ceiling facing materials. Vilene is also hoping to grow sales in this division through the establishment of an automotive mat manufacturing facility in Thailand, which will sell materials not only within Thailand but also throughout Southeast Asia.

To help it boost sales in the faltering air filtration market, Vilene acquired shares of Oshitari Labs, a manufacturer of filters for industrial air conditioning units.

For the fiscal year ended March 31, 2014, the weakness of the Japanese yen benefitted exports and share prices, a situation that benefitted Japan Vilene Group, which reported a 13.4% increase to ¥54.5 billion ($532 million) in corporate sales as well as a 164% increase in consolidated operating income. Nonwovens sales were reported at ¥20.9 billion ($204 million).

In August 2013, the company published its three-year mid-term plan 2013-2015, through which it stated a goal of achieving consolidated net sales of ¥61.5 billion ($600 million) and consolidated operating income of $42 million by 2015. Furthermore, the company intends to promote its eight basic strategies of the Mid-Term Management Vision and strengthen structural profitability in order to be unaffected by changes in the external environment. Specifically, Japan Vilene has set out four “key challenges” as priority policies—promoting new products and businesses; expanding core businesses and strengthen profitability; improve productivity and strengthen human resources training and development.

In the industrial and electrical materials department, sales of battery separators for hybrid vehicles decreased from the previous year due to the specificiation change of some car models while sales of nickel hydride separators for general use increased due to strong overseas demand. Sales of Nicad battery separators decreased due to a weak demand for electrical tools. Sales of photocopier cleaning rolls decreased due to the trend of going paperless in many offices

In the air filtration department, sales of general use media remained flat as washable filter sales were low and spray painting filters and other disposable products were up. Sales in the medium and high efficiency filter category decreased as did cabin air filter sales. However, division sales were up significantly following the acquisition of Oshitari Laboratory, a Tokyo-based manufacturer of chemical filters and electric discharge machines, in August 2013.

According to Japan Vilene, Oshitari’s products and market are different from those of Vilene and the two companies will benefit from many synergies.

Within automotives, floor mat sales increased in North America on the heels of the establishment of a new company in Mexico. Sales increased in Japan also due to favorable car sales and Asia. The new site in Mexico was established in May 2012 and began making nonwovens for floor mats in January 2013. It was established to ensure the stable supply of automotive floor mats in Mexico as Japanese car manufacturers and major automakers are expanding production there.

Looking ahead into 2014, Vilene expects floor mat sales to increase further on the establishment of a Thai subsidiary to manufacture floor mats for the ASEAN region where sales of new cars are growing rapidly.

Meanwhile sales of headliner materials decreased due to design changes of some of its customers. To combat this the company has installed a multifunctional printing line to make Twinetex, a three-dimensional headliner material that was introduced to market in 2011.

For the fiscal year ended March 31, 2015, Japan Vilene Group’s net sales were ¥56.5 billion ($456 million), a 3.5% increase compared to the previous fiscal year, while nonwovens sales were reported at ¥19.7 billion ($159 million). In the apparel and medical materials segment, sales rose to ¥10 billion ($80.7 million), a 1.1% increase compared to the previous fiscal year. According to the company, sales of interlinings declined from the previous year largely due to low sales of men’s and women’s wear. Sales of cold compress-based materials decreased from the previous year due to weak sales of domestics, though overseas sales were strong and new products boosted sales of plaster-based materials. The sale of face masks increased from the previous year due to strong sales of decontamination use while demand in coolin gel sheets and cosmetic face masks boosted medical cosmetic materials sales.

Sales for air filter materials were ¥8.1 billion ($65.4 million), up 5.2%. While sales of filters for general use decreased from the previous year, sales of medium and high efficiency filters increased from the previous year. Sales of cabin air filters for automobiles decreased largely from the previous year due to moving the production site overseas and because of sales decreasing both in Japan and overseas. Total sales of the air filtration sector increased mainly due to the August 2013 acquisition of Oshitari Laboratory, Inc.
Sales of Japan Vilene’s electricity and industrial material sales dropped 12.9% to were ¥8.7 billion, and sales of battery separators for hybrid vehicles decreased largely from the previous year due to low sales of hybrid vehicles in North America. Sales of Nickel hydride separators for general-use decreased from the previous year due to weak demand for batteries, while lower demand for electrical tools brought sales of Nicad battery separators down. Other areas facing decreases included photocopier cleaning rolls, liquid filters and printed circuit boards.

Automotive materials sales were ¥28.9 billion ($233.2 million), up 10%. Sales of floor mats in North America increased from the previous year thanks to the favorable sales of cars, success of the new Mexican factory and exchange rate movement. Sales of floor mats in Japan decreased from the previous year because sales of new cars declined after last-minute demand, but they grew in Asia thanks to Chinese strength. Sales of headliner materials in North America increased from the previous year due to increasing automobile production and exchange rate movement. Domestic sales exceeded the previous year due to good sales of new orders and export cars.

In August, Freudenberg SE and Toray Industries announced they would acquire all shares of Japan Vilene through FT Holdings K.K., with Freudenberg and Toray will own 75% and 25% of the common shares of the company, respectively. Currently, Freudenberg owns 33.4% of Japan Vilene (17.6 billion)—being the largest shareholder of the company—and Toray owns 17.49% (9.2 billion shares)—the second largest shareholder.

Once the acquisition is final, Freudenberg and Toray will enter into a shareholders’ agreement with respect to the operation of Japan Vilene, which will require Freudenberg to obtain Toray’s prior consent when making decisions on certain material matters of the company. Additionally, transfer of the shares of Japan Vilene requires consent of the other party, and each party has the preemptive right in proportion to its shareholding ratio when the company issues new shares.